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F E D E R A L R E S E R V E BANK O F NEW YO RK Fiscal A gen t of the United States r Circular No. 7 3 2 7 1 L January 29, 1974 J OFFERING OF TWO SERIES OF TREASURY BILLS $2,500,000,000 of 91-Day Bills, Additional Amount, Series Dated November 8, 1973, Due May 9, 1974 (To Be Issued February 7, 1974) $1,800,000,000 of 182-Day Bills, Dated February 7, 1974, Due August 8, 1974 T o A ll Incorporated Banks and Trust Companies, and O thers Concerned, in the Second Federal R eserv e D istrict: F ollow in g is the tex t o f a notice issued b y the T reasu ry Departm ent, released at 4 p.m. to d a y : T h e Treasury Department, by this public notice, invites tenders fo r tw o series o f Treasury bills to the aggregate amount o f $4,300,000,000, or thereabouts, fo r cash and in exchange fo r Treasury bills maturing February 7, 1974, in the amount o f $4,302,550,000, as fo llo w s : companies and from responsible and recognized dealers in invest ment securities. Tenders from others must be accompanied by payment o f 2 percent o f the face amount o f Treasury bills applied for, unless the tenders are accompanied by an express guaranty o f payment by an incorporated bank or trust company. 91-day bills (to maturity date) to be issued February 7, 1974, in the amount o f $2,500,000,000, or thereabouts, representing an additional amount o f bills dated N ovem ber 8, 1973, and to mature M ay 9, 1974 (C U S I P N o. 912793 T L 0 ), originally issued in the amount o f $1,800,915,000, the additional and original bills to be freely interchangeable. Imm ediately after the closing hour, tenders w ill be opened at the Federal Reserve Banks and Branches, follow in g which public announcement w ill be made by the Treasury Department o f the amount and price range o f accepted bids. O nly those submitting com petitive tenders w ill be advised o f the acceptance or rejection thereof. T h e Secretary o f the Treasury expressly reserves the right to accept or reject any or all tenders, in w hole or in part, and his action in any such respect shall be final. Subject to these reserva tions, noncom petitive tenders fo r each issue fo r $200,000 or less w ithout stated price fro m any one bidder w ill be accepted in full at the average price (in three decim als) o f accepted competitive bids fo r the respective issues. Settlement fo r accepted tenders in accordance with the bids must be made or com pleted at the Federal Reserve Bank on February 7, 1974, in cash or other immediately available funds o r in a like face amount o f Treasury bills maturing February 7, 1974. Cash and exchange tenders w ill receive equal treatment. Cash adjustments will be made fo r differences between the par value o f maturing bills accepted in exchange and the issue price o f the new bills. 182-day bills, fo r $1,800,000,000, or thereabouts, to be dated February 7, 1974, and to mature A ugust 8, 1974 (C U S I P N o. 912793 U J 3 ). T h e bills o f both series will be issued on a discount basis under com petitive and noncom petitive bidding as hereinafter provided, and at maturity their face amount w ill be payable without interest. T h ey w ill be issued in bearer form only, and in denominations o f $10,000, $15,000, $50,000, $100,000, $500,000 and $1,000,000 (m aturity v a lu e ). Tenders w ill be received at Federal Reserve Banks and Branches up to the closing hour, one-thirty p.m., Eastern Daylight Saving time, M onday, February 4, 1974. Tenders w ill not be re ceived at the Treasury Department, W ashington. Each tender must be fo r a minimum o f $10,000. Tenders over $10,000 must be in mul tiples o f $5,000. In the case o f com petitive tenders the price offered must be expressed on the basis o f 100, with not more than three decimals, e.g., 99.925. Fractions may not be used. It is urged that tenders be made on the printed form s and forw arded in the special envelopes which w ill be supplied by Federal Reserve Banks or Branches on application therefor. Banking institutions generally may submit tenders fo r account o f customers, provided the names o f the customers are set forth in such tenders. Others than banking institutions w ill not be per mitted to submit tenders except fo r their own account. Tenders w ill be received without deposit fro m incorporated banks and trust Under Sections 4 5 4 (b ) and 1221(5) o f the Internal Revenue Code o f 1954, the amount o f discount at which bills issued hereunder are sold is considered to accrue when the bills are sold, redeemed or otherwise disposed o f, and the bills are excluded from considera tion as capital assets. A ccordin gly, the ow ner o f Treasury bills (other than life insurance com panies) issued hereunder must include in his incom e tax return, as ordinary gain or loss, the difference between the price paid f o r the bills, whether on original issue or on subsequent purchase, and the amount actually received either upon sale o r redemption at maturity during the taxable year fo r which the return is made. Treasury Department Circular N o. 418 (current revision) and this notice prescribe the terms o f the Treasury bills and govern the conditions o f their issue. Copies o f the circular m ay be ob tained from any Federal Reserve Bank o r Branch. T h is Bank will receive tenders fo r both series up to 1 :30 p.m ., Eastern D aylight Saving time, M onday, F ebruary 4, 1974, at the Securities Departm ent o f its H ead O ffice and at its B uffalo Branch. T ender form s fo r th e'respective series are enclosed. Please use the appropriate form s to submit tenders and return them in the enclosed envelope marked “ T en d er fo r T reasu ry B ills.” T enders not requiring a deposit may be submitted by telegraph, subject to written con firm ation ; n o tenders m ay be submitted by telephone. Paym ent fo r the Treasury bills cannot be made by credit through the Treasury T ax and Loan Account. Settlement must be made in cash or other immediately available funds or in maturing Treasury bills. Results o f the last w eekly offerin g o f T reasu ry bills (9 1 -d a y bills to be issued January 31, 1974, representing an additional amount o f bills dated N ovem ber 1, 1973, m aturing M ay 2, 1974; and 182-day bills dated January 31, 1974, m aturing A ugu st 1, 1974) are shown on the reverse side o f this circular. A lfred H ayes, President. (o v e r ) RESULTS OF LAST W EEK LY OFFERING OF TREASURY BILLS (TW O SERIES TO BE ISSUED JANUARY 31, 1974) Range of Accepted Competitive Bids 91-Day Treasury Bills Maturing M ay 2,1974 A p p ro x . equiv. annual rate P rice A p p rox. equiv. annual rate 98.040 98.030 7 .7 5 4 % 96.210 7 .4 97% 7 .7 9 3 % 98.034 7 .7 7 8 % ! 96.195 96.200 7 .5 26% 7 .5 1 6 % ! P r ice H ig h .............................. .................. L o w ................................ .................. A v e r a g e ......................... .................. 182-Day Treasury Bills Maturing August 1,1974 1 These rates are on a bank discount basis. T he equivalent coupon issue yields are 8.04% fo r the 91-day bills, and 7.92% fo r the 182-day bills. (61 percent o f the amount o f 91-day bills bid fo r at the low price was accepted.) (2 percent o f the amount o f 182-day bills bid fo r at the low price was accepted.) Total Tenders Applied for and Accepted (By Federal Reserve Districts) 91-Day Treasury Bills Maturing M ay 2 ,1974 District A ccep ted A pplied f o r ...................... B oston ........... $ 85,175,000 182-Day Treasury Bills Maturing August 1,1974 $ 26,370,000 A pplied f o r $ 82,915,000 A ccepted $ 10,415,000 N e w Y o r k ..................... ........... 5,150,820,000 2,154,890,000 2,723,680,000 1,275,715,000 P h ila d e lp h ia .................. ........... 69,825,000 23,115,000 43,710,000 11,510,000 Cleveland ....................... ........... 87,725,000 34,725,000 48,860,000 25,855,000 R ich m on d ..................... ........... 38,710,000 23,020,000 48,145,000 17,845,000 ......... 24,885,000 20,455,000 44,525,000 15,720,000 ......................... ........... 441,060,000 92,580,000 245,410,000 25,285,000 St. L ou is ....................... ........... 89,490,000 26,155,000 58,250,000 38,800,000 .................. ........... 27,560,000 5,260,000 34,750,000 5,255,000 K ansas C i t y .................. ........... 37,770,000 28,235,000 29,985,000 23,035,000 Dallas .............................. ........... 40,750,000 19,250,000 37,235,000 15,235,000 301,765,000 52,395,000 543,695,000 335,720,000 A tlanta ........................... C hicago M inneapolis San F rancisco .............. T otal .................... ........... $6,395,535,000 $ 2 ,5 0 6 ,4 5 0 ,0 0 0 a Includes $383,750,000 noncompetitive tenders accepted at the average price. b Includes $235,180,000 noncom petitive tenders accepted at the average price. $3,941,160,000 $ 1,800,390,000b